NSIA records 20% growth in 2015 fiscal year


Nigeria Sovereign Investment Authority (NSIA), manager of Nigeria’s sovereign wealth funds, has recorded increase in its audited results for 2015, reflecting the fund’s fiscal position and investment activities for the year.

Indeed, the total assets recorded a growth of 20 per cent to N213.66 billion at year end while its investment grew by 47 per cent to close at N5.8 billion. The total comprehensive income increased to N26.3 billion representing a 67 per cent growth.

The year which ended in March 2016, saw an additional $250 million capital approved for allocation to the Authority. This was consequently received in February 2016 and will be invested within the new fiscal year using the existing deployment ratio of 40 per cent in infrastructure, 40 per cent in Future Generations Fund and 20 per cent in Stabilisation Fund.

The result further stated that five Private Equity (PE) fund managers in which four are Nigerian-based, bringing NSIA’s total commitments to PE fund managers to 24.

This in turn strengthened the infrastructure intervention framework through co-investments collaborations with other institutional investors.

“2015 was a difficult year but the NSIA managed to protect its capital in a harsh and volatile market environment where equities and bonds in many leading economies suffered declines. In particular, the decision to invest in Alternative Asset classes proved beneficial in 2015 as this ensured that our portfolio was relatively immune from the market forces while traditional asset classes suffered significant declines.

The result showed that NSIA progressed work on the Nigeria Credit Enhancement Facility, which is expected to be operational in the second half of 2016.  The report showed that the facility will provide credit enhancement solutions to project companies raising senior debt in the form of bonds to finance vital infrastructure projects. NSIA partnered with GuarantCo, an experienced credit enhancement provider, in the launch of the facility.

The Authority continues to manage assets for Nigeria Bulk Electricity Trading Company (NBET) and the Debt Management Office (DMO). While NBET’s $350 million remains fully invested, half of the funds managed for the DMO was recalled and redirected to other investments reducing the assets under management to $100 million.

In his reaction, Chief Executive Officer and Managing Director, NSIA, Uche Orji, disclosed that NSIA made fewer, but more strategic investments in 2015.

More importantly, he said NSIA has invested in various private equity investment funds to tap into the high-growth sectors across Sub-Saharan Africa.

These, he stressed represent NSIA’s commitment to invest in alternative assets that offer superior performance and are less correlated to broader public equity market volatility.”

He attributed the 2015 fiscal year to a characterized high volatility and global market uncertainty. Currency turmoil, dwindling oil prices and decelerating growth across markets created a difficult investment environment for the Authority. Nonetheless, the overall results were positive”.

However, he said NSIA would maintain its strategy of a diversified portfolio to drive returns and mitigate market volatility with an anticipation that global market volatility will continue in 2016.

The outlook for the oil market will remain challenging. Nonetheless, NSIA said it would continue to explore other asset management opportunities on behalf of the Federation.